Although the importance of emotions in economic decision-making is being widely accepted, it is still unclear how and to what extent emotional processing affects economic behavior. In this paper, we propose a new methodological framework for behavioral IS studies that we call physioeconomics, by which it is possible to measure psychophysiological correlates of human emotions during controlled laboratory experiments. In contrast to brain imaging technologies as in NeuroIS, the analysis of autonomic physiological parameters can be achieved with a comparatively low amount of measurement overhead and, thus, allows collecting empirical data for much larger sample sizes. Therefore, this approach is particularly qualified for the study of emotions in electronic markets. In order to show that physioeconomics is able to provide insightful results we apply this method in an exemplary auction experiment in which we compare bidders’ arousal throughout the bidding process and in response to winning or losing.